AIG Holding Back $21M in Bonuses: Report

NEW YORK ( TheStreet) -- American International Group ( AIG) is looking to hold back $21 million in bonus payments to former employees, a report says.

The amount would exceed the $5 million AIG needs to reach $45 million which it has been trying to recoup in order to satisfy pay czar Kenneth Feinberg's demand, the Wall Street Journal reports. So far, AIG employees, mostly current and some former, have agreed to return $40 million, in part by accepting lower 2010 payouts.

AIG also on Monday will pay out $46 million which mostly will go to former employees who left the company after parts of the financial products business, known as AIGFP, were wound down or sold. Five current employees will divide about $6 million, the source told the newspaper.

Under the agreement between AIG and Feinberg, the insurer can reduce the retention payments by the amount of income ex-workers have earned after their departure from AIG, a person familiar with the matter told the Journal.

Feinberg also is reviewing new 2010 pay packages for a group of AIG's most highly paid executives, including some at AIGFP, the Journal says.